New Jersey and Pennsylvania should bank on solar – new report

A report commissioned by trade associations representing more than 100 solar companies in New Jersey and Pennsylvania has, perhaps not surprisingly, extolled the benefits of photovoltaics over conventional electricity generation.

Photovoltaics provide a premium return to ratepayers in New Jersey, according to a new report.

Solis Partners

The Mid-Atlantic Solar Energy Industries Association (MSEIA) and its Pennsylvania counterpart, the PSEIA, commissioned consultants Clean Power Research to quantify the value of solar-generated electricity by identifying the cost savings against power generated by a gas turbine plant and various long-term benefits.

The study includes an examination of figures, such as the environmental and economic development values of using solar over conventionally-generated power. It concludes that the value of solar electricity – at a penetration rate of 15% from four different types of solar array at seven locations – varies from US$256 to $318/MWh.

The trade associations point out that even if the price of solar renewable energy certificates (SRECs) – which power providers are obliged to purchase to fulfill their renewable energy obligations – rise, the true value of solar electricity to society and consumers will still represent a significant premium on the market value.

With SRECS costing $60/MWh in New Jersey and $20/MWh in Pennsylvania, MSEIA president Dennis Wilson said, "This indicates that electric ratepayers in the region are getting more than a two-to-one return on their investment in solar energy.

"Although the current SREC prices are unsustainably low, our analysis indicates that SRECs can increase in price, deliver net benefits and still support strong solar growth. Solar power has proven it can deliver value that exceeds its cost by 50% to over 100%. This net positive benefit will only increase as solar technology continues to drop in cost."

Clean Power Research stresses in the report that it tends towards conservative estimates of the "softer" benefits of solar, for instance using only the predicted enhanced tax revenues from employment in solar – against gas turbine – electricity generation, as the basis for its Economic Development Value of solar.

The study also factors in an estimate of the cost of adapting the grid in New Jersey and Pennsylvania to cope with the different strains put upon it by a solar penetration of 15%, using a figure of $10-$20/MWh.